Coppersmith Capital Sends Letter to Gregg Powers, Newly Appointed Chairman of Alere, Inc.

  Coppersmith Capital Sends Letter to Gregg Powers, Newly Appointed Chairman
  of Alere, Inc.

Business Wire

NEW YORK -- June 19, 2014

Coppersmith Capital Management, LLC today announced that it has sent a letter
to Gregg Powers, the newly appointed Chairman of Alere, Inc. (NYSE:ALR).

The full text of the letter follows:

June 19, 2014
Mr. Gregg J. Powers
Chairman & Chief Executive Officer
Private Capital Management
8889 Pelican Bay Blvd
Naples, FL 34108l

Dear Gregg,

As the owner of approximately 2.3 million shares of Alere, Inc., let us
congratulate you on your election as Chairman of Alere’s Board of Directors. I
wish you luck, particularly as you are now personally responsible for the
strategic and operational disorder at Alere. I know you’re smart enough to see
the obvious path forward to creating value for Alere – I hope you’ll have the

With the 2015 due-dates for Alere’s strategic plan targets around the corner,
let’s review where Alere is today: SG&A margin has increased to 30.6% instead
of the forecast decline to 28%; Professional Diagnostics organic growth has
declined to -1% instead of accelerating to mid-to-high single digits; and
despite the $600mm in near-term divestiture proceeds promised last year, Alere
has announced no divestitures, failing spectacularly in its attempt to
complete an initial public offering (IPO) in the UK of BBI Diagnostics Group
plc. Who could have ever foreseen the failure of an overseas IPO with a
poorly-run majority owner, a non-integrated, thematically-disparate bag of
assets, an illiquid JV comprising roughly half its valuation and severe
restrictions on its ability to deploy capital?

Thankfully there is a better option: we understand that Alere has received
unsolicited expressions of interest from potential strategic acquirors within
the last year, but has failed to engage interested parties. As such, we
believe Alere can be sold today at a significant premium to its current stock

As Chairman of a diagnostics company, I would hope you’d appreciate the value
of early detection: Alere’s management and strategic plan appear to be
failing, horribly. You can choose to wait until the patient is on life
support, or you can muster the conviction to do something about it now. The
strategic and operational review Alere has announced is a fine example. Alere
will undoubtedly spend months and millions on this process, only to confirm
what the Board likely already knows or, perhaps more disturbingly, to give it
the courage it needs to prove it to Ron Zwanziger. Coppersmith has already
spent excessive time and money on the question of how to fix Alere, so let us
help by sharing our findings:

  *Ron Zwanziger has failed as CEO of Alere. Creating virtually no
    stockholder value and billions of liabilities and write-downs over five
    years should prove that to any sane business person. It is time to move
  *Even if Connected Health (CH) is the wave of the near-future, Alere does
    not have the personnel, assets or market positions to be a meaningful
    competitor. Even in Ron’s wildest fantasies of contract wins this year, CH
    will not contribute meaningfully to Alere’s bottom line, soon or
    potentially ever. We believe this is why Alere has NEVER articulated a
    profitable CH business model, even as shareholders starve for such
  *Even under new management, Alere’s underperforming businesses and bloated
    capital structure will take significant time and risk to fix. On the other
    hand, Alere’s assets retain meaningful value and can be monetized today at
    an attractive premium for shareholders.

We had hoped that driving Alere to replace half its Board, demote its Chairman
and commence a review of strategy and operations would be enough to convince
the Board to be realistic, finally, about Alere’s performance and prospects.
We believe it is time to engage a new investment bank (unaffiliated with past
failures) to explore all strategic alternatives including the sale of the
company. Sometimes holding out for better performance doesn’t get you more
value. Sometimes it gets you less.

Jerome Lande

Cc: Alere, Inc. Board of Directors


Sard Verbinnen & Co
Dan Gagnier, 212-687-8080
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